Tesla wants to cut size of board from 11 directors to 7

3of19Eberhard was initially the CEO of Tesla Motors before Elon Musk (pictured) was named the chairman of the board, and ultimately CEO of Tesla Motors.Photo: ChinaFotoPress, ChinaFotoPress via Getty Images

4of19Tesla said the two-seat Roadster could get up to 200 miles per charge.Photo: Tesla Motors

5of19The first Model 3 cars were delivered in 2012 after being announced in 2008. The Model S became the bestselling electric car in the United States in 2015.Photo: James Lipman, Tesla Motors

6of19Model S Teslas start at $69,000.Photo: Tesla Motors

7of19Tesla manufactures cars at their highly-automated factory in Fremont, Calif. The plant was previously used as a collaboration between General Motors and Toyota.Photo: Tesla Motors

8of19A rendering shows the so-called Gigafactory currently under construction in Nevada, which will produce batteries for Tesla's cars. Nevada won out to other proposed sites in California, Arizona, Nevada, New Mexico and Texas.Photo: Tesla Motors

9of19The Model S is much more practical than the Roadster with four doors and cargo space under the rear hatch.Photo: Tesla Motors

10of19The Tesla Model S also has a small front trunk for extra storage.Photo: Tesla Motors

11of19The Model S P85D, a high-power variant of the S, makes an equivalent of 691 horsepower, according to Car & Driver.Photo: Telsa Motors

12of19The P85D gains power over the normal Model S with the inclusion of an additional motor at the front wheels.Photo: Telsa Motors

13of19The P85D, already quick, was quickly given a software upgrade called "Ludicrous" mode which allows the car to accelerate from 0-60 in 2.8 seconds.

14of19The Tesla Model X was announced in 2013 with first deliveries beginning in 2015.Photo: Tesla Motors

15of19The Model X is a full-size crossover that starts at $80,000 but can sell upwards of $140,000 for the Signature model.Photo: Tesla Motors

17of19In August 2015, in preparation for the first deliveries of the Model X (pictured), rolled out new software features including their so-called "Autopilot."Photo: Tesla Motors

18of19In March 2016, Tesla introduced the Model 3, and immediately accepted hundreds of thousands of pre-orders for the vehicle which is supposed to sell for around $35,000. Few, if any real specs have been released.Photo: Tesla Motors

19of19On June 9, 2016, Tesla announced yet another model, the Tesla Model S 60, which will sell for slightly less than the Model S.Photo: Tesla

PALO ALTO, Calif. (AP) — Tesla plans to cut its board of directors from 11 to seven in a move the electric-car maker says will allow the board to act more nimbly and efficiently.

Tesla says the four directors who will depart aren't leaving because of any disagreement with the company.

The board has come under closer scrutiny since August, when CEO Elon Musk tweeted that he had lined up funding and was considering taking the Palo Alto, California-based company private at $420 per share. That didn't happen, and regulators accused Musk of securities fraud.

Tesla disclosed the upcoming changes to the board in regulatory filings Friday.

Brad Buss, a director since 2009, and Linda Johnson Rice, who joined the board in 2017, plan to leave at the annual meeting in June. Two early Tesla investors, Stephen Jurvetson and Antonio Gracias, plan to leave next year if shareholders agree to shorten Gracias' term by a year.

"This shakeup of the board has been long overdue," said Stephen Diamond, a corporate-governance expert and associate law professor at Santa Clara University who has urged changes in oversight at the company. "It is a very important step towards greater accountability to Tesla's owners, the public shareholders, because it breaks up the old-boys network around Elon Musk."

Extreme opinions about Tesla are completely wrong — here's...

Lyft might eventually make money — but it could take 7...

The shareholder meeting is June 11 in Mountain View. Shareholders will vote on other proposals that the company says will improve its corporate governance, including shortening directors' terms from three years to two years, and dropping a supermajority voting requirement.

The changes are the latest moves by Tesla in response to criticism that the board has lacked independence from the company's mercurial CEO.

The Securities and Exchange Commission sued Musk last year, accusing him of misleading investors by falsely claiming in a post to his 22 million Twitter followers that he had arranged funding to take Tesla private.

The SEC sought to remove Musk as CEO, but the two sides settled with Tesla agreeing to pay $40 million and have Musk step down as chairman for at least three years. In December, Tesla named two independent board members as part of the agreement.

Tesla Inc. shares closed Friday at $273.26 after a gain of $2.03. They have fallen 18% this year and 29% from their peak on Aug. 7, when Musk made his going-private tweet.